Brake & Anor v Guy & Ors (Preliminary Issue)

A public interest, or “iniquity”, defence may be available to claims for both breach of confidence and misuse of private information. The defence is not excluded because the defendant acquired the information unlawfully. The relevant question is whether the public interest in disclosure, including disclosure to relevant victims, insolvency office-holders or regulatory authorities, outweighs the interest in preserving confidentiality and privacy.

In a misuse of private information claim, the defence operates at the justification stage rather than when determining whether there was a reasonable expectation of privacy. The court must assess the actual documents disclosed and the proposed recipients. A party need not plead the legal source or formulation of the defence, provided the material facts and nature of the case are pleaded.

The claimants sought an injunction and damages concerning the defendants’ alleged access to, retention and use of private and confidential emails from three email accounts. They advanced claims for breach of confidence and misuse of private information.

The defendants pleaded that the emails evidenced an unlawful scheme, breaches of duties and court orders, and wrongdoing affecting creditors and insolvency office-holders. They relied on the public interest in retaining and disclosing the material.

The preliminary issue was whether, assuming the pleaded allegations were proved, the “iniquity defence” was available as a matter of law. The court also considered whether the defence failed because the defendants had not expressly pleaded articles 8 or 10 of the ECHR.

1. Defence available to both causes of action. The court rejected the submission that an iniquity or public interest defence was unavailable to a claim for misuse of private information. The principles governing privacy and traditional confidentiality should be developed and applied consistently. Articles 8(2) and 10 of the ECHR were sufficiently wide to encompass the defence, even if it was not described by that name. The defence arises at the justification stage, after any reasonable expectation of privacy has been established.
2. Unlawful acquisition does not exclude the defence. The court rejected the proposed distinction between information lawfully received and information unlawfully acquired. Gartside v Outram, Initial Services Ltd v Putterill and Lion Laboratories v Evans demonstrated that unauthorised removal or copying did not prevent reliance on public interest. The decisive question was the public interest in the proposed disclosure, not the legality of the initial acquisition.
3. Application depends on the material and recipients. The court distinguished Imerman v Tchenguiz on its facts and context. That case did not establish that a defence was unavailable where private information was obtained without consent. The balance must be conducted by reference to the actual documents and the proposed disclosure. Limited disclosure to relevant authorities or persons whose rights may have been affected may be justified, although broad disclosure or a document dump may not be.
4. Past civil wrongdoing may engage the public interest. There was no rule excluding disclosure merely because the alleged wrongs were civil, committed by private persons, or concerned persons without a public persona. The balance would depend on the circumstances. Evidence of significant frauds against creditors or concealment of assets could engage a substantial public interest in the proper operation of insolvency systems.
5. Pleading. The public interest defence was a matter of law rather than fact. Under CPR rule 16.5, it was sufficient to plead the material facts and the nature of the case. The defendants were not required expressly to plead articles 8 or 10, the legal test of necessity, or the legal characterisation of the public interest. Whether disclosure of particular documents was justified had to await trial.
6. Disposition. The claimants had not shown that the defence could not succeed as a matter of law. The preliminary issue was answered accordingly.